Around the world, regulators are still wrapping their heads around what existing rules apply to social media and what new rules need to be crafted. One area of interest I’ve been following in this arena surrounds celebrity tweets in the UK.

Similar to the FTC’s role in the US, the UK’s Office of Fair Trading enforces consumer protection laws. In 2008 that office issued its Consumer Protection from Unfair Trading Regulations. Those regulations came into question in late 2010 and early 2011 over the issue of commercially compensated celebrity tweets. When Elizabeth Hurley sent out almost a dozen tweets mentioning Estee Lauder’s “divine” skincare products and Lily Allen tweeted about her experiences with the new Playstation Move and Grey Goose Vodka (separately, of course, otherwise that’d be far too challenging) regulators took interest.

It’s always a good idea not to mislead your customers when it comes to testimonials or endorsements—not just because it may be the law but also because it prevents backlash from a customer later discovering the communication was perhaps less than honest (like the Honda Eddie Facebook case). In the wake of these Twitter campaigns and the regulators’ crackdown the industry moved to disclosing all compensated tweets with an appropriate hashtag such as #ad, #paid, or the most popular tag of #spon (short for sponsored and not, as suggested to me, an abbreviation of “I’m a celebrity and I’m spooning with this company right now”).

Yeah, I'm eating chocolate and I got paid a lot of money to do it. How do you like me now?

The most recent complication has come up over a clever Snickers campaign that pushes the envelope on when a celebrity must disclose. This campaign involved multiple tweets by a celebrity—first the celebrity would send out a tweet that appeared completely out of character. A popular footballer (soccer player for my American friends) sent out a tweet about his love of knitting between matches. A successful model tweeted a detailed analysis of economic issues. And so on. After the initial wave of “What the heck is this person talking about?” subsided then the celebrity would send out another tweet about how you just aren’t yourself when you’re hungry, typically with a picture of the celebrity now eating a Snickers bar and the appropriate #spon hashtag.

Regulators have taken interest in the campaign because, let’s face it, it’s fun to talk about chocolate. But they’re also questioning whether the initial tweets sent out by celebrities should have included the #spon hashtag since they were paid for and part of a broader campaign. It’s an interesting question since it asks where we draw the line between compensation and commercial effect.

If we regulate social media activity solely around whether money exchanged hands then it’s easy to make a case for the #spon hashtag to be required in this Snickers case. It’s a bright line test that is easy to communicate and apply: money = disclose. However, that test could also negatively impact other activities that tend to look innocent or might actually be innocent. Imagine a charity that works with an athlete but paid the athlete’s travel costs to attend an event—if the athlete tweets about the charity should that be a #spon tweet?

On the other hand, if we regulate based on the marketing impact of the message then we might be able to say that Snickers did it right this time. People reading the first celebrity tweet in the campaign might think it was odd (then again, it’s a celebrity, so they might not think that at all) but wouldn’t have a chance to be persuaded to buy a Snickers bar. And while that first tweet may have led to more people being curious about the follow-up and receiving that marketing message, the second message had the proper disclosure. But using a commercial effect test rather than bright line test discussed earlier could lead to difficult analysis in future cases and possibly inconsistent rulings depending on the activity. Then again, that’s true of a lot of marketing regulations.

Marketing campaigns strive to be engaging and persuasive while regulators want to ensure they are not misleading and unfair. This is an important balance for all consumers. Making this case trickier is the fact that Twitter is incredibly limited in terms of space which has led some regulators to come up with disclosure exceptions or special rules for Twitter. So what’s the best test for this case and beyond?

In this particular case, I think Snickers did it the right way. Anyone reading just the first tweet hasn’t been sold on Snickers and it’s possible they just thought it was a celebrity acting…well, like a celebrity. If they did read the follow-up then the disclosure is there. But the first message, standing on its own, does not have a commercial message.

I wouldn’t go so far as to say that in an extended Twitter or other social media campaign that only the last message requires the proper disclosure. Instead, I believe an appropriate rule would be to require disclosures on any message (tweet, post, share, etc.) that has a commercial impact if the message is viewed in a vacuum.

Do you think that rule would be too difficult to apply or does it strike the right balance between marketing and disclosure?

Update (March 12, 2012): Thanks to my colleagues in Europe, I was recently informed that the issue had recently been decided. The full adjudication is here but the short summary is that the Snickers campaign was allowed. Snickers (via Mars, the parent company) argued two theories for allowing the campaign. First, that the initial tweets were not marketing communications but only the final tweet transformed the initial tweets into commercial communications–this theory was rejected. Instead, regulators seem to agree with Snickers other theory that only the final tweet was a marketing communication. They don’t expressly endorse the view but they do discuss how only the final tweet had marketing elements and a tie to the brand. The regulators said that this final tweet did set context for the initial tweets but did not transform them into marketing so it was acceptable to not have the #spon tag in the text.

IMPORTANT DISCLAIMER

SoMeLaw Thoughts are entirely my own opinion about social media legal issues and not the statement, opinion, or in any other way affiliated with Dell.

This means I could be completely wrong about everything I post here. Sure, I’ve practiced for over ten years in technology law and have supported Dell’s social media team for a fair amount of time, but if you get five lawyers in a room and ask a question you’re likely to get seven different opinions. Oh, and it’s a really boring room. And someone will probably start quoting Latin. So I could be totally wrong here.

This is also not specific legal advice for you. I don't know you. Even if I know you I didn't write this for you, I wrote it for the blog and you're reading it. You want legal advice? Hire an attorney! A good one.